Economy

7:05 pm

Sat April 5, 2014

Americans Are On The Move, But In The Wrong Direction

Moving to San Bernardino from Los Angeles may help with housing costs, but the area doesn't have much economic opportunity.

Reed SaxonAP

Jamika lives in a two-story apartment complex surrounded by a 10-foot-high security gate in San Bernardino, Calif. The yellow paint on the buildings' outside walls is peeling.

She doesn't want to use her full name. She doesn't want too many people to know about her situation.

Jamika and her siblings had to leave the house her family was renting in South Central L.A. when the property went into foreclosure. With money so tight, Jamika moved to San Bernardino, along with three of her siblings.

All around the country, the cost of housing is driving people out of places with the most economic opportunity, like L.A. They, like Jamika, are leaving cities with better job markets in search of a cheaper place to live.

Jamika, who works in food service at a nearby hospital, says she probably won't go back to L.A.

In San Bernardino, she says, she can actually save some money. And she says there's no way she could do that in Los Angeles.

Cheap To Live, Tough To Work

Between 2007 and 2011, more people moved from Los Angeles County to San Bernardino County than between any other county-to-county pair in the nation.

The median home value in San Bernardino County is about $235,000, according to the real estate company Zillow. In L.A County, it's almost twice that. So it makes sense that people would move here to save money on housing.

In the city of San Bernardino, where Jamika lives, not much looks good besides the housing prices.

"San Bernardino is bankrupt," says City Council member Jim Mulvihill. "Because of that, we've cut back. We had 340 on our police force, now we're down to 240. And given all that, we've had a high crime rate."

Mulvihill, who used to teach urban studies at California State University, San Bernardino, says there are two kinds of people who move here from L.A. There are employed people who want a house but can't afford one in L.A., and then there are those who don't have jobs and just need a cheaper place to live.

For people who come to San Bernardino unemployed, Mulvihill says the options here are limited. Like so many American cities, San Bernardino used to be a place for middle-class jobs. A big steel plant employed tens of thousands of people until it closed in the 1980s. Norton Air Force Base, which was just 2 miles east of downtown San Bernardino, also closed in the early '90s.

"There was about 10,000 civilian jobs, and about 6,000 military people. And so the city lost all those," he says.

Mulvihill says the jobs that are available are low-wage jobs — at the local casino or in food service. Warehouses for retailers like Amazon and food companies are also one of San Bernardino's biggest industries.

Miles From Opportunity

So even though people are saving money on housing in San Bernardino, they're making less money than they might in L.A., where there are more — and better-paying — jobs.

It's a national phenomenon, says writer Timothy Noah, whose most recent book, The Great Divergence, covers income inequality. People can't always afford to live where the work is, he says.

"You have to tackle the housing problem, but you also have to tackle the inequality problem," Noah says.

He says the example of L.A. and San Bernardino, in which people are living far away from the best jobs, shows how inequality is blocking opportunity.

"People need to be able to pick up and go to where the jobs are; jobs don't stay in one place forever," he says. "To the extent that isn't happening, the economy is going to stagnate. And guess what, our economy is stagnating right now."

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Transcript

KELLY MCEVERS, HOST:

It's ALL THINGS CONSIDERED from NPR West. I'm Kelly McEvers.

Yesterday, I did what a lot of people here in Southern California do every day: I got in my car and hit the freeway.

So here we are. We are about to cross the county line from Los Angeles County into San Bernardino County.

The reason we're doing this drive is it's a well-worn path. More people moved from L.A. County to San Bernardino County over the last decade than any other county-to-county pair in the whole country - tens of thousands, maybe even hundreds of thousands. It's something that's happening all over the country. In the places with the most economic opportunity, housing prices are too high. So now, instead of moving toward the good jobs, sometimes people have to move away from them. It's our cover story today: Americans on the move in the wrong direction.

(SOUNDBITE OF MUSIC)

MCEVERS: When we finally get to San Bernardino, we drive to a complex of two-story apartment buildings built in the '60s or '70s, peeling yellow paint surrounded by a 10-foot high security gate with spikes on top. Jamika takes us up to her balcony.

So cool. So how long have you been in this place (unintelligible)?

JAMIKA: I've been here - it's going on a year now.

MCEVERS: Jamika is 28. She says she doesn't want to use her full name, doesn't want too many people to know about her situation. She says she grew up in a rented house in South Central L.A. The house was foreclosed on, and she and her siblings had to move out. Money was tight, so Jamika moved here to the inland empire. People call it the IE.

JAMIKA: So my older sister was already out here. Then me and my other sister came out here. My brother slowly came out here. And then my other brother came out here, but he went straight to a house, because that's what he can afford. He can do all that stuff. And then my other sister, she's the only one who stays out in Los Angeles still, in her home that she has. So...

MCEVERS: So out of how many siblings, one stayed?

JAMIKA: Out of - yes. Five that's all in the IE, and one is still out there.

MCEVERS: Jamika says she probably won't go back to L.A.

JAMIKA: Yeah, I missed it when I was younger. But right now, I'm on my grown woman status - job, car, house, well, apartment. So I'm good.

MCEVERS: Jamika works in food service at a nearby hospital. She doesn't want to say how much she pays in rent. She does say it's public housing. Neighbors make about $700 a month and pay one to $200 in rent. Jamika says here, she actually can save some money. No way she could do that in L.A.

JAMIKA: Yeah. I have another friend here who lived in Los Angeles who moved out here. I don't know if you'd want to talk to her.

MCEVERS: Sure.

JAMIKA: Tamia.

MCEVERS: Inside Jamika's apartment, her friend Tamia says she also moved to San Bernardino from L.A. So do two other ladies we meet outside. Census data suggests tens of thousands of people have made this move. IRS returns say it could be hundreds of thousands. To know how cheap San Bernardino is, look on Craigslist. Two bedroom apartments here are as cheap as 700 bucks a month. And to buy a house, the median home price in San Berdoo is just $173,000. In L.A., it's nearly three times that. So it makes sense that people would move here to save money on housing. But what does the city have to offer?

JIM MULVIHILL: You know, San Bernardino's bankrupt. The city's bankrupt.

MCEVERS: Standing out in front of city hall, city councilman Jim Mulvihill tells me San Bernardino's not in the best shape right now.

MULVIHILL: Because of that, we've cut back. We had 340 on our police force. Now, we're down about 240. And given all that, we've got a high crime rate, had lot of shootings. So people are concerned.

MCEVERS: Jim used to be a professor of urban planning at Cal State San Bernardino. He says there are two kinds of people who move here from L.A. County. The first because...

MULVIHILL: They've got a job. They work in L.A., or they work in Los Angeles. But the point is they want to buy a house, and, you know, they're not quite up to the income level. And so, you know, the realtors always talking about you drive until you qualify.

MCEVERS: One to two hours each way, and that's if you have a job when you leave L.A. County. For people who come here without a job, Jim says the options are not good.

MULVIHILL: And you're going to make a - up to the light, you'll make a right.

MCEVERS: Driving around town, Jim says like so many American cities, San Bernardino used to be a place for middle-class jobs. A big steel plant employed tens of thousands of people until it closed in the '80s. And then...

MULVIHILL: Norton Air Force Base closed up in the early '90s. And at Norton, there was about 10,000 civilian jobs and about 6,000 military people. And so the city lost all those.

MCEVERS: Jim Mulvihill says the jobs that are available are low-wage jobs. The local casino, food service jobs like the one Jamika has, and one of San Bernardino's biggest industries...

MULVIHILL: A lot of warehouses.

MCEVERS: ...for retailers like Amazon. So even though people are saving money on housing here, they're making less money than they might in L.A., where there are more and better paying jobs. It's a phenomenon we're seeing across the U.S., says writer Timothy Noah, and not just in the expensive places we all know, like San Francisco, New York and Boston.

TIMOTHY NOAH: Maryland is not a place where you'll find many millionaires or billionaires, but it is a place where you'll find an awful lot of highly paid lawyers. So it has the highest median income in the country, and yet for most of the last 20 years, more people who've moved out of Maryland than into it.

MCEVERS: Because, you know, you would think that these boom towns - San Francisco, Boston - I mean, the idea is that if you build a tech company, there's got to be somebody to build the building, to clean the building, I mean, that it creates jobs. Is it that the jobs are there, but people can't afford to stay and do the jobs?

NOAH: Yeah. I mean, it's unbelievable. The local business press in San Francisco quoted a guy named David Hayes, who's the CEO of Skyline Construction. And he said his biggest challenge was recruiting. And he said: We started relocating candidates from Southern California and recruiting out-of-state candidates. He said that they've even started asking retired workers to re-enter the workforce. It's a vicious circle. People can't afford to move to these places, and then you can't find or you struggle to find people to build what housing does get constructed.

MCEVERS: I want to go back to our example, the example of moving from L.A. to San Bernardino. What could be done to fix that problem? I mean, you're saying that it's a housing issue, right?

NOAH: It's one of two ways. You have to tackle the housing problem, but you also have to tackle the inequality problem. There are a lot of people who think they don't need to worry about income inequality. But to the extent that it is choking the avenue towards economic growth and towards economic opportunity, they do need to worry about it.

And this seems to me a good example where it is blocking a pathway to opportunity. All economies rely on migration as a way to grow. People need to be able to pick up and go to where the jobs are. Jobs don't stay in one place forever. To the extent that that isn't happening, the economy is going to stagnate. And, gee, guess what, our economy is stagnating right now.

MCEVERS: Timothy Noah is a writer. His most recent book covers income inequality. It's called "The Great Divergence." Transcript provided by NPR, Copyright NPR.